The government on Tuesday notified electoral bonds, as a new instrument for donations to political parties, in a bid to clean up election funding in India.

Announcing the contours of the scheme in Parliament, finance minister Arun Jaitley said the bonds will bring substantial transparency in political donations against the present system of anonymous contributions.

“The political funding mechanism developed over the last 70 years has faced wide criticism as people don’t get clear details about how much money comes, from where it comes and where it is spent,” Jaitley said.

Though called ‘bonds’, it is an interest-free instrument in the nature of a promissory note, which can be purchased for any value, in multiples of Rs 1,000, Rs 10,000, Rs 1 lakh, Rs 10 lakh and Rs 1 crore from specified branches of the State Bank of India (SBI).

“A citizen of India or a body incorporated in India will be eligible to purchase the bond,” the finance ministry said in a statement.

The bonds can be bought only once KYC norms of SBI are fulfilled and the payment for it has to be from a bank account. The bonds will not carry the name of the doner, said the government statement.

And this is where political analysts said that electoral bonds will fail in its objective to inject transparency into political funding.

“The fact that the donor remains anonymous is the most damaging aspect of electoral bonds. Anonymity and transparency do not go together. If black money has to be removed, then all funds to political parties should be routed through digital payments,” said Jagdeep Chhokar, founding member of Association for Democratic Reforms.

Electoral bonds would have a life of only 15 days during which it can be used for making donation only to the political parties registered under section 29A of the Representation of the Peoples Act, 1951, and can be redeemed only through registered bank accounts of parties.

Many months in the making, electoral bonds were announced in Budget 2017-18 by Jaitley to bring transparency in the opaque system of political party funding, often plagued by allegations of corruption. To this end, the government had earlier capped anonymous cash donations to political parties at Rs 2000.

The bonds will be available for purchase for a period of 10 days in January, April, July and October and an additional period of 30 days that will be notified by the government during general elections.

These bonds will be part of the returns filed by political parties with the Election Commission.

As the contours of the electoral bonds were being worked out there were reportedly concerns about the misuse of this instrument. The finance minister explained that the 15 day validity of the bonds is to ensure that they do not turn into a “parallel economy”.